The Dividend Cafe - Thursday - January 9, 2025

Episode Date: January 9, 2025

Market Closure, Payroll Data & Investment Insights - January 9th Edition In this episode of Dividend Cafe, Brian Szytel discusses the market closure in observance of President Carter's funeral and offers condolences to those affected by California wildfires. Brian highlights the anticipation around non-farm payroll data, expected unemployment rates, and wage growth stats. He also introduces David's annual white paper summarizing the investment outlook and reflections on past predictions. Brian emphasizes the value of reading macro-related research but cautions against overly relying on it for portfolio strategies. The focus remains on bottom-up fundamentals for security selection and asset allocation. He concludes with a nod to the upcoming wildcard weekend in sports. 00:00 Introduction and Market Closure 00:51 Upcoming Economic Data 01:34 Dividend Cafe Annual White Paper 02:18 Macro Research Insights 03:02 Investment Strategy and Philosophy 04:29 Conclusion and Weekend Plans Links mentioned in this episode: DividendCafe.com TheBahnsenGroup.com

Welcome to the Dividend Cafe, weekly market commentary focused on dividends in your portfolio and dividends in your understanding of economic life. Welcome to Dividend Cafe. This is Thursday, January the 9th. Brian Tytel with you here today on a very quiet day in the markets because the markets were actually closed in observance for President Carter's state-sponsored funeral service. And so the bond market was actually open for a little more than half today, but closed early as well. All the stock indices in the U.S. were closed. So not much to report today. We want to recognize a great civil servant in President Carter. And we also want to keep all those in California that are affected by these horrific wildfires in our thoughts and prayers.

We've had some close personal friends affected and it's just a devastating natural disaster. So our hearts go out to everyone there. That aside, in markets tomorrow, we'll have non-farm payroll out. We're looking for unemployment to essentially hover at the same area, which is 4.2%. I think the market will be focused on the wage growth number, which is expected to come out around 4%. That's perceived as an input into inflation. It's not a TBG house view, but nonetheless, something markets might pay attention to. And then we're expecting somewhere near 150,000 jobs created for the month of

December. As there's some seasonal variability around some of this, so these numbers can shift. So it'll be the largest market moving piece of economic data that we'll have on the week. And so we'll be, and also markets will be open to adjust to it. So we'll watch that for tomorrow. The other thing I wanted to mention is for Dividend Cafe on Friday, we'll have David's annual year ahead, year behind white paper. This goes over everything that we viewed going into 2024 as far as themes and theses that we thought were going to be relevant and important and how they played out and whether we were spot on or somewhere in the middle or way off. So he grazed them A to F. I think it's relevant for people to read through because it gives a pretty good glimpse into the

way we look at the world, the humility that we have as we do so, and then also what we view as relevant for the coming year, which is what most people pay attention to. So please do read that. I've read it. It's really one of his best, if not his best. So we look forward to that in your inbox for tomorrow. There was a question related to macro related research. If we have people on the team solely focused on it, we read all of it. Let me back up. We don't read all of it. We read a whole lot of it. Some of it is useful. Some of it really, frankly, isn't. Reading objective data points and relevance associated with it, even geared towards making the point, is perfectly fine and cogent, and I

appreciate it. We read a lot of it, hundreds of pages a week. Reading 17 different people give me their prognostication on, because the euro did this, and the yen did this, and because this and that, this is what's going to happen in 2025. I just take it for what it is. It's someone's guess. They don't know. And they're making an educated guess about it. And since there's an infinite number of them and about 50% on each side of the trade, take it for what it's worth. So all that to say, we focus on this stuff. We read it all. We love it all. I read it on the weekends. It's what I read when I'm at the beach with my children. So don't take this for there not being a passion. It's the opposite of that.

There is a complete passion for it. What I have found as flaw is when portfolios end up positioning around a certain thesis playing out in order for that portfolio result to be positive or not. And I really think it's a travesty. I see it all the time. And I really do warn and encourage readers and listeners that just understand that a lot of what's written and published out there is for the purpose of gaining clicks and eyeballs. And so there's going to be oftentimes more of a negative bias because we're humans and

that's what we gravitate a little bit more towards. If everything is going pretty good, that's not as exciting in other words. So that's what I have to say about it. Our analysts on the team are really focused on bottom-up company by company fundamentals and we screen for them. They're surgically focused on these things and we think that's a better use of their time. Senior level investment committee members, myself and David, are focused on the macro and we use that information as well as that bottom-up information for security selection, but also for asset allocation decisions. Everything's client by client, and that's why I wrote the summary in there. It's company by company, and it's client by client. And that's the way we look at portfolios.

The macro side plays a part, but it doesn't drive. So that's what I have to say there. Hope you found that useful. It is, again, Thursday the 9th, and we've got Wildcard Weekend coming up. So if your team is in there, mine is, which is the Chargers playing Saturday, I'm excited for that. And if yours isn't, we've got next year. In any case, have a wonderful evening and reach out with your questions. Thank you very much. The Bonson Group is a group of investment professionals registered with Hightower Securities LLC, member FINRA and SIPC, with Hightower Advisors LLC, a registered investment advisor with the SEC. Thank you. that the investment process or investment opportunities referenced herein will be profitable. Past performance is not indicative of current or future performance and is not a

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